the storm is grounded 2000 flights and coul power to many who just had service with regards to tax cuts and deregulation, it's not the same restored following the earlier that regards to trade, but if storm. a foot of snow is expected. trump comes out this week and gives us details about whether there will be carveouts, that could put this to rest. secretary of state rex tillerson arrived in ethiopia. if he goes full on with a blanket tariff structure, that he is the most senior u.s. could's -- radel some. official to set foot on the african continent since president trump took office more to talk about the departure of gary cohn and a lot than a year ago. he was to mend the damage done of the folks under him. there have been rumors about the by the derogatory description of tenure of some of the folks there. african nations. you know, we are getting to this stage now where who is driving current secretary david schopp and took no action to fix the agenda in the white house is going to be different than who long-standing problems that put drove it in the first year. majorts at risk and that is definitely going to reflect in the volatility we veterans hospitals according to have seen in the markets. investigation that finds failed leadership at a climate of steve mnuchin, front and complacency at the v.a.. details tooffers new

center as the final one in the white house. , thank you for its finding of patient safety issues at the washington dc medical center including dirty that. syringes and equipment breaking news? scarlet: cosco, reporting shortages. in washington, benjamin earnings, topline and higher than the netanyahu called for a hard line expected 32.7 5 billion, with on iran. nuclear deal with six world comparable sales in the u.s., higher than anticipated. powers has added to their increasing dominance across the analysts were looking for up middle east. a tiger has been like 6.2%. stock had been rising in after-hours trade. unleashed from its cage. that's quite a boost. and is saidiched it time for our weekly segment, the community of nations they are just devouring the nations. charts go, time to look at in anhe is fighting off depth charts and bloomberg functions. abigail? intensifying corruption probe in israel. abigail: joining me now is dan global news powered by more than russo. thanks for taking the time to and taking the track 2700 journalists and analysts in 120 countries. this is bloomberg. from long island to be here. lots of volatility this year. today included. last night we were looking at

the s&p 500 down, finishing fractionally lower. what do you make of all of it? are we more likely to put in a new all-time high or a lower low julia: live in new york, i'm first? we are consolidating in an julia chesley. scarlet: i'm scarlet fu. julie: julie hyman. uptrend market in january. , the s&p 500 mixed we have corrected that a bit here terry a back to the 200 day moving average, extended on the sleeping -- falling. upside, extremely overbought. testing the 200 day, in the 50 scarlet: the question is what'd day moving average, that's been you miss? gary cohn exit stage left. the bottleneck for now. areaday, my view is that we what hisabout consolidating in an up trend to resistance onast departure means for the future of the trump white house. top executives meeting in houston this week. the upside. however, i think we still have you will hear from the head of some consolidating to do in light of the uncertainty we have trump's expedition unit. over rising interest rates. what do you see as the and steve mnuchin joins us. -- we gets thoughts

possibility of a diamond top or his thoughts on the tariffs. bearish consolidation that could take the s&p 500 back down? . sounds like you don't think >> president trump proposed below, but that the tariffs could pitch him against consolidation could go down to the 200 they moving average. his own party. his chief economic advisor technology and semi resigned over the decision leaving the white house without conductors are strong. its moderating influence and discretionary relative to consumer staples, it's at an creating a void which could be all-time high. julia: abigail: what do you make to -- filled by the trade -- abigail: what do you make of hardliners. the utility sector and overall major averages? great to have you with us. dan: utilities trending lower is talk about what you think the a function of interest rates departure means to economic moving higher. that is our view. termy and in the short you will continue to see the 10 with the decision over these tariffs. year yield rise to 3.2%. board onk across the both sides you are seeing utilities are falling off and condemnation of this as a have checked up a bit, but what helps me to come to that view is policy. it was clear his influence had

the on balance indicator at the botte selling either been minimized or the is not letting up. president was ignoring him on this issue. could that be a concern i am not surprised he would leave. for you, with this down 20%? there are a lot of business nowle and economists saying be a concern for you, what? several advisers who remain have when you see more for utility? been talking absolute economic for something with a much nonsense. , ithey get the upper hand bigger wait, i would be concerned, but given that, less could be a bad sign for the u.s. of a concern. the but dollar index, economy and the world. >> like all of us you are an what do you think? outsider looking in. bearish, since december to some degree does it matter who that person is if the 2016, so trying to check up here president is going to listen to his own counsel? and being turned away again with a mac they can barely get into he says he is his own best advisor. positive territory, rolling over >> you have a point. again. that is what i was saying, if you are the head and the abigail: any opportunity for it president doesn't listen to you to go higher? it doesn't matter if you are there or not there. was over zero, d

if president trump is going to ignore evidence that these tariffs and this economic i would give that credence, but i think we still have some work isolation is going to destroy to do abigail:. love it. .- to do more manufacturing jobs than it does, if he is going to abigail: thank you very much. that, what difference does it make? but it does matter because there 3 a report -- julia: a republican backlash, one senator boat load of terrible pushing a bill to give congress ideas that come through every white house and a double boat a greater authority over tariffs. load of bad ideas come through this is bloomberg. in this white house. ♪ mom, dad, can we talk? there have to be some people pushing back getting rid of the worst ones. i reallyoes away shudder to think what could be coming down the pipe. people makeot of the point that he was head of the nec, a process is person. he didn't have to come up with policy but it had to go to the appropriate place.

that was impossible in this white house. tariffs will said not be signed until the end of the week but there could be a carveout from mexico and canada. if there are carveouts, could be a -- could they be salvaged and make more fair and reciprocal trade deals with other countries? >> no. it wasn't thought through to begin with. they just spouted it out as if it were a policy but it wasn't. now they are going to scramble not to violate a bunch of agreements the u.s. has already signed up for. we will almost certainly be sued by the wto. if they are talking about they are going to go on a company by sure. what's up, son? company or country by country basis, how in the world are they i can't be your it guy anymore. what? going to enforce such a policy? you guys have xfinity. you can do this. what's a good wifi password, mom? is anot problem is steel you still have to visit us.

i will. no. make that the password: intermediate good. it is used in the production "you_stillóhave_toóvisit_us." process of all sorts of that's a good one. manufacturing. seems a bit long, but okay... of cars, of airplanes, of set a memorable wifi password with xfinity my account. blue-collar manufacturing jobs. one more way comcast is working to fit into your life, not the other way around. 25%ou raise the price by retail. under pressure like never before. the 87 to 110,000 people who and it's connected technology that's moving companies forward fast. work in the steel industry are happy. 6 million people who work in the e-commerce. real time inventory. virtual changing rooms. industry that by steel are not that's why retailers rely on comcast business happy. to deliver consistent network speed across multiple locations. the sum total is a negative number. every corporate office, warehouse and store it is a terrible idea. near or far covered. julia: we have the canadians up leaving every competitor, threat and challenge outmaneuvered. in arms. we have the mexicans concerned about this. comcast business outmaneuver. reason sarah huckabee sanders is talking about these carveouts for mexico and canada is because we recognize it is a mark: i'm mark crumpton, with problem over nafta. first word news. the president has tried to use

this as leverage to get the demonstrators in sacramento attl nafta negotiations to continue and the response has been stony. jeff sessions address the law enforcement conference. is nafta more at -- more or less his speech came one day after the trump administration sued at risk now? california over several laws >> it is hard to answer that. that restrict government we are on the seventh round of authorities and private businesses from cooperating with renegotiating. there are and were aspects of federal immigration agents. nafta that could be modernized. >> california, we have a problem all sides agreed to that. . a series of actions and events the trump administration has not has occurred here that directly and adversely impact the work of been advocating modernization. our federal offices. they have just been throwing for example, the mayor of hand grenades in trying to blow oakland has actively, has been it out. weeds get too far in the actively seeking to help illegal aliens avoid apprehension by on this analysis but this policy ice. they outlined of tariffs is >> we have millions of people premised legally on national here without papers. some of them working for 10, 15, security. 20 years. the reason the president would have the authority to impose they have been serving the economy. a lot of them during the dirty unilateral tariffs would be work -- doing the dirty work. because this is a threat to mark: governor brown accused national security. for the president to say

actually this is a negotiating sessions of trying to up -- trying to appease president deal out ofa better trump and divide america. nafta means he has undermined sobering and inspiring, that's how betsy devos described her the legal case for the reason he visit to marjorie stoneman has the right to do this. douglas high school in florida. i don't understand what they are doing. the scene of last month's mass i want to ask about the trade shooting. deficit. we just got the numbers today. she called the discussion of arming teachers and over subrogation and in january.n years 506 $56 billion last mischaracterization -- over civil vacation and mischaracterization. >> the concept is that for those schools and communities who . opted to do this, as they have is the deficit a problem? what is the right way to fix it? in texas and polk county and >> the trade deficit is a other places around the country, to have people who are expert in macroeconomic phenomenon. being able to defend and having it is not based on industry level trade agreements. how the u.s. economy does lots and lots of training in order to do so. gave herretary devos relative to other country economies influences that. support for a house bill taken to help school you don't increase the deficit by trillions of dollars with a gigantic tax cut, which you know staff respond to signs of potential student violence.

is going to lead you to have to borrow money if you are trying to reduce the trade deficit. a three-day visit to britain for the trade deficit is the inverse the prince of saudi arabia. later he met with theresa may, of how much money people are who said that she would raise concerns about human rights investing in the u.s.. violations. british police say that they if we are going to borrow money believe a former russian spy and from china to pay for the asset his daughter were poisoned with for the deficit you can't a nerve agent, that's according turn around and say how did this to the associated press. happen? , joining usolsbee authorities believe that they from chicago. were specifically targeted. sunday's attack is being treated coming up, we will bring you as attempted murder. the police officer who treated them when they collapsed is also more from the conference and in serious condition. this is bloomberg. houston. this is bloomberg. ♪ -- serious condition. global news, 24 hours a day, powered by 2700 journalists and analysts in over 120 countries. i'm mark crumpton, this is bloomberg. getting a recap on market action, a mixed read for stocks, but it doesn't tell the whole story.

the story was one where we were looking at deep losses at the open following gary cohn leaving. the index has ground higher so that they have closed near the best levels of the session. the dow and the s&p closing in the red. this is unfairly thin volume, given that it was essentially a girlfriend -- a snow day in the northeast. julia: congressional republicans pushing back against the president, pressuring him to limit the scope of the aluminum and steel tariffs. some are taking legislative action. mike lee of utah has renewed tols to curve the tariffs require congressional authority. he joins us now from capitol hill. senator, great to have you with us. why do you think this is essential at the moment?

sen. lee: i started this a number of years ago, long before we had any idea who the party nominee would be. with an eye towards having congress reclaim authority, they are constitutionally empowered to set tariffs and import duties, things like that. to decide trade policy questions . congress needs to exercise that power. over 90 years they have been steadily delegating that power to the chief executive and the action announced by the president last week, which many in congress are uncomfortable great example of why congress should be exercising more power in the first place. julia: you say that this is the president of using that power? the power itself has been excessively delegated. it's a mistake to use section

232 in the manner prescribed. i think it will harm consumers julie: the energy conference and workers. underway in houston rings together the biggest names in the fact that it is being exercise that all should be a energy and finance. alix steel started by asking wake-up call for us and a reason that we should pass reform. i hear you're saying, about gary cohn's departure from the white house. but one could make the argument >> the fact that i am running a global business is one that that congress has not proved its metal. typically does it benefit from that a lot of things get gummed up in the works and that when constraints across borders. the power lies in the executive branch, things can get done. when you start to move tariffs, that creates uncertainty. how do you respond to that? sen. lee: my response to that it typically, for a company like is, great. a that keeps is away from shale,for a company with it makes it more complicated in trade war, fantastic. it's supposed to be difficult to terms of certainty and in terms take on a trade war that kills jobs and livelihoods. of the benefits that open we want to make it more markets. difficult to start a trade war. >> also in terms of actual under what conditions, if cause.

if you have steel and aluminum costs rising when does it impact any, are they a good idea? how fast you can grow? sen. lee: there are several we havef the concerns is steel plants in the u.s. are categories that would give the at 75% of capacity today. president temporary authority to use his executive authority unilaterally, in instances of with the growth in the shale national security, for example, putting a 90 day limit or shot business it is a steel intensive business. the exercise of that there's a lot of pipelines. is infrastructure bill authority. manyme instances there are focused on enabling more who would argue that there are certain national security pipelines to take full advantage of the energy resource we have instances in which they would like to impose tariffs. now in the u.s. and north america. if you increase the price and i understand that, that's often the justification put forward. but that's not present here. start to strain the capacity because you are limiting the imports that is only going to be our national security needs can be satisfied by 3% of what we an obstacle for advancing the use in a year to. development of the resources. producing about 80% of the steel that we have in the united states in our own country. >> are you at that stage yet? those who wille

>> we are going to see what happens with the announcement look at this to say that this is an obvious move by the president and how that is going to evolve , saying he's effectively buying the votes of these individuals. through the system but we are concerned about the capacity of ultimately, given the costs that the manufacturing in the u.s. to you have described as a result, be able to generate the steel we will this actually be a vote losing strategy if he follows through? are going to need. expect yourdo you production to grow? >> let me say that in terms of sen. lee: the number of jobs put shale is a future growth at risk far outnumber those jobs. the american consumer, the american worker on a whole will opportunity. be harmed by this action more shale is not a in active growth than anyone will be helped. priority. active growth is deepwater and that's one of the reasons we should consider it. petrochemicals. we should reconsider this and you can see the things we are pass reforms that will bring this back to the article one doing with the big petrochemical branch, the people's ranch and plant we are building in pennsylvania, we're positioning one of the reasons we should consider doing what congress did shale for future growth. in response to jimmy carter's shale announced the plan is to action in 1980, deciding to override his decision and

move shale to active growth by overrode a presidential veto to that effect. julie:it of a 2020. i'm spending two and a half hard turn to another issue that billion dollars a year. i plan tota there in the next i know you are passionate about. he recently wrote an op-ed with bernie sanders and chris murphy couple of years. regarding u.s. involvement in yemen by way of supporting the that is quite a bit of money. i am growing production at 30% saudi efforts there in that conflict. annual increase in production on you three, suggesting that we the back of our canadian shale should withdraw that support. over the next couple of years. >> how much more land do you both for humanitarian and other reasons. need or want in the u.s.? for that?ound support >> i want less land. and what is the next step if we i like things like the permian. draw that -- if we do withdraw that support? is that wey view density, the shouldn't be fighting in a war that congress has an authorized. thickness of the package is there. you need less land. there's a shared power at stake. >> but you do need it the president of the united states is empowered as our continuous. commander in chief. on the other hand, congress has do you want to buy that land? the power to declare war.

expandpreference is to at some point those powers can overlap a bit. where we are. where we already have critical we have been involved since 2015 in a civil war in yemen. mass of activity. we have been assisting the we want to look to expand their first. coalition led by the kingdom of in canada it would be a place we saudi arabia in active involvement as a co-belligerent were -- would look to expand. in that conflict. liquids.y on it's the kind of thing that they require congress to authorize. we already have dry gas in our short of that authorization, there should be no involvement. portfolio. ourh is going to enable that's what i'm calling for and that's why i want us out of that conflict. it's not our war unless or until canada project off of western congress declares it such. canada which is still in the senator mike lee, planning stages. our actual growth focus would be republican of utah, member of on liquids, through swaps or the commerce committee, thank you for joining us. bying up, we will be joined through advantage priced type the chevron north american acquisitions. exploration and production president. >> would that be bhp? a reminder that you will want to subscribe to our weekly podcast assetsnature of the bhp on itunes.

is something that would be attractive for us but there are you will find the best content to enjoy over the weekend. lots of those opportunities in this weekend we have a conversation with jeff dennis of the canada portfolio to expand ubs. this is bloomberg. ♪ from where we are. >> your growth profile, what is the one disruptor for that? what would make us not get to that goal is the same thing that is going to limit industry, that is managing the license to operate. we've got to continue as an industry to manage the license to operate. societal acceptance andoing to govern the u.s. taking full advantage of the shale opportunity. scarlet: it is now time for our stock of the hour. gas -- our stock is

dollar tree. results not so great. >> it was a modest miss but the sale did come in lower then the estimate. the bigger concern, guidance is less than what was expected. the range well below that. they had unexpected freight and wage costs. they are taking tax overhaul savings and putting it back into training. these results are weighing on whether or not discounters -- how are they doing, weighing on target. costco reports after the bell. jitters.ld be they are not really the same store. >> they all get lumped together. were wasn't so long ago we

watching the saga. how was family dollar doing? >> it is doing pretty well. the issue here are margins. look, we are going to see the acquisition here in 2016, and even revenue split. take a look at the margins. 44% for family dollar. 23% for therades, family dollar. they are going to be revamping stores. hopefully that will help. julie: "what'd you miss?" >> short-term discomfort for long-term benefit. we continue our coverage of the energy conference, in texas. alix steel sat down with jeff shellebarger and started asking plus, guidance for this year may be disappointing. about the prospect of terrorists.

>> we have the global supply it is a five-year chart. we see this uptrend. chain. "are, open sources of supply for has plungedtock that technology is very important. with respect to the terrace behind the moving average. today, certainly we put that on the business, it would have to incur the cost of what we would have to offset. we are likely to see the longer-term buyers step in and support shares. but it is early days, it's a negotiation and a conversation. but, who knows. maybe it breaks below this. we are watching it closely. it won't have an immediate impact on our business. the last five years suggest this the cost, we have already is a pattern they see. . seen rising cost pressures in >> and by on the weakness. equipment, whether it comes from wells fargo defending the stock journaling, workers, or wages. as it has this big pullback. what do you see this year? >> cosco is coming up after the close. is variable across the scarlet: america's profitability operations that we have. improving. we have the charts that show at the end of the day, we look at the business fundamentally as the cost for the development just that. side.

increases, and i don't see that material, we are spending $8 million this year and north america, it is going to flow through the system, so we will have to watch and a trust. do you have a read on what you see? jeff: again, it's not specific for across-the-board. we put a lot in place with respect to contracts, so we have some mitigations on the pressure that the smaller players don't have. we were to enter a more protectionist world in the u.s., does that affect your top allocation? a worst-case scenario, absolutely, but we are not at that point yet. we look at the investment in the

u.s. and had to compete with everyone else globally. it got to the point where we were disadvantaged, globally. today we had a great environment for business in the u.s. and we hope to continue that with some of the changes and the things that occurred over the next few years. alix: you have great production expectations, looking at the double production from 2022, 60,000 barrels per day. what is the one thing that could stand in the way of meeting that goal? jeff: it's a great resource and a great opportunity for us. a large resource base and land-based. the cost for us, we have flexibility in terms of how we want to develop the resource. things we are focused on our the unit costs, costs per barrel. is thing i worry most about actually the degradation of the performance of our investment over time. that can come from significant cost escalation.

quality of from the the reforms from contractors and businesses. scarlet: what you miss? again, we work with very good business partners and contracting structures to based on thethis is the reprise. mitigate some of that inflation. how quickly are you the red arrows, the developing? what we have seen in terms of too far too fast is an exception being 2016. operational issue that can damage the quality of where you are working. this does not mean growth is how are you with that? slowing. jeff: we have been ramping up data is missing economist estimates. we have seen the first quarter and took a deliberate approach weakness consistently. to understand where this -- the sweet spots were, understanding this here, no exception. where we wanted to be. bottom indoes tend to basis.ow down the june. it is a self correcting scarlet: let them make -- alix: indicator. because this is something that we will see in the coming days let them make the mistakes? [laughter] jeff: it was trial and error, we with focus on data with the federal reserve coming up, the were in a position where we didn't have to go through that. credit goes to -- once we did -- one -- once we

julia: speaking of no surprises, understood what we wanted to do, we deliberately put together a mind the gap as far as the trade will, andase, if you deficit is concerned. what we wanted to do was come the widest since 2008. and role thate core of thate level as we ramped up. cometh concern over the deficit with china. there, increasing president donald trump tweeting this. that to 20. our relationship with china has confident, i guess, that we would get the returns on been a good one. the activity. we look forward to see what ideas they come back with. kinds of returns are $1 billion. have a look at my next chart. you looking for? jeff: in terms of the growing double give us a sense that how margin and the production. big the trade deficit is. alix: the breakeven is pretty take a look on the right-hand side. darn low. billion for january. we haven't released that if you are asking the chinese to breakeven. thewe can tell you is that reduce by $1 billion i am sure they will say awesome, we will most attractive investments in go for it. the global portfolio are sustainable at the very low end

of the price environment. >> there was a lot of head julie: that was jeff scratching over that tweet. shellebarger. aarlet: coming up next, other levers the battle of perception between small towns and big cities. administration potentially has what's feeling the politics of is the u.s. dollar. resentment in wisconsin and around the country? as the president sees the this is bloomberg. ♪ referendum of his tariffs being played out in the stock market will he pulled back? we have already seen a softening of the stance with regard to canada and mexico. then you have the operating markets for the s&p 500 which have been it relatively elevated levels as we have seen this week . one of the things that has helped those operating margins. something to watch is the continuing rhetoric from the trump administration. there has been back-and-forth but it is mostly dollar weakness . >> and an option for china to offset.

>> trade wars and currency wars. >> the market close is next check it the #and at the major indexes. this is bloomberg.

julie: "what'd you miss?" both democrats and republicans missed the growing chasm between small-town and big-city americans, resentment from those who have benefited from changes and disruption in the 20th century. this was long before trump was elected president. a professor of political science and wisconsin traveled around

the badger state researching this and summed it up in her book, the politics of resentment. she joins us now from madison. professor, your bush was -- your book was published eight months before the election. a lot of ink has been spilled over the cost of widening inequality. what have you learned in the field, talking to people about the experts and the observers? >> thanks are having me on. i learned that people in small towns in small communities held ignored, disrespected, and overlooked by political elites, the people who make the decisions that affect their lives. like they weren't getting their fair share of attention, resources, or respect. professor, i want to ask [clapping] you about how that has informed the presidential election and, until now, watching the tariffs "ulia: "what'd you miss? debate unfold, with president

trump really seeming to address, u.s. stocks in a mixed close as the s&p 500 comes back off the perhaps, the people who did not feel listened to in this case, talking about steelworkers. lows of from earlier in the day. i'm julia chatterley. scarlet: i'm scarlet fu. does that kind of line up with your research? hyman, in i'm julie that perhaps people feel they have found a champion? for joe weisenthal. if you are tuning in live on twitter, we want to welcome you to our closing bell coverage, >> yeah, in a way. there's a lot of folks who just feel as though, and i think they every weekday from 4 p.m. to 5 p.m. eastern. we are looking at a stock market really wish that the government paid attention to them and that has come off the lows. listened to their concerns. with trump, when he comes along it was a jagged move hired. and says things like you are the dow in the s&p didn't make right to be so upset and you it into oz it of territory, deserve more and gives people though the s&p came in close by storylines for why their lives the end. have changed, it's been really the sectorlected in compelling for folks. performance, tech shares ending the day by half of 1%. volume is important to i will admit, a lot of times they are not necessarily happy with his tweeting behavior and they are not necessarily thinking that he's actually talk about, we've got to talk about the snow happening in the northeast. scarlet: the storm hasn't going to come to their community

and change things in their necessarily been as bad as community, but what they see is predicted, but a lot of people andone who acts differently did stay home. some of them might be trading seems -- he behaves as if he is from home, but volume was 12% a definitely going to change things up quite a bit. low the daily average, something to consider as we look at the back and forth action. over theice action i'm not sure if they expect them to be a champion for their session, we have climbed communities, but they definitely steadily since 1 p.m. seeing him something different. how doesw -- julia: we saw a key increase as a result of what we got, as you mentioned earlier, this bounce the promise versus reality from the likes of mexico and change things? we saw a swing vote towards the canada, these tariffs, a of arats in the election softening of the stance. scarlet: especially since the senator. change is happening already. >> it's possible that there's a announcement is supposed to be made tomorrow and it is still shift towards the democratic very much moving pieces here. , but i'm skeptical of from rickheard it saying that because when i ask people in my fieldwork which party but -- better represents perry, down in houston, saying it will like what you think it's going to look like. people around here, a lot of scarlet: the big question is, times they say without skipping a beat, they say neither, who is going to lead that effort, now that gary cohn has neither party is really paying

departed? attention to people like me. looking again at the dow whether or not it is a shift finishing lower, but grinding higher near its highs of the towards one party or another, it's hard to say. session, the 10 year yield moving down, the dollar slightly i don't feel -- i don't think that's accurate. weaker, copper and other industrial metals are under who feel they are being pressurewashington. paid attention to, someone who kevin: i also want to welcome will respect to they are as on bloomberg radio. human beings. julia: no real choice. scarlet: that's why outsiders we are joined by the treasury are getting elected as well. secretary, steve mnuchin. i want to start now by comments people trying to understand why some voters seem to vote against made earlier by yourself and secretary ross, that there could what seems to be their own interest. like where whole small-town potentially be, if the president and next a tax -- tariff communities vote against proposal, and exemption for government support and vote for another country. what would the president have to smaller government when they, themselves, rely on government support. do to qualify? steve: he has artie declared increased medicaid funding is a perfect example. that it relates to mexico and canada. >> sometimes for the people say to me is -- look around my to the extent that we have a new nafta agreement with them, they will be exempted from the steel community and you tell me that whatever is going on here is a sign that government is working and limited tariffs. for people like me. i'm not going to comment on

other countries, that would be choice they are making premature, but canada, we have a doesn't seem to be benefiting people in places like mine. close relationship in terms of steel, going back and forth, and that is something we are focused so, that argument that we need on. to thewith regards less government or need to drastically change government, it's really appealing to people who feel that whatever timing of the announcement, is it logical to think we could get government has been doing is not the output this week? steve: that is the plan, yes. working for me. did you find policies could be as early as tomorrow or friday, we are working to get that were more universally the finishing documents on this. popular? -- kevin:hen you look >> people care a lot about education. not specific policy, but people when you look at the response seem to be willing to pay money from the people around the world for education, but they are skeptical at times of being asked to pay higher taxes for it , the people who have criticized this and filed complaints, what on a statewide basis, because is your response to those criticisms? steve: first, i would say let's just put this in perspective. they are worried that that money is going to go to cities as the president has been clear, opposed to their smaller communities. well said. this has been since the campaign and his presidency on what his economic agenda is. thank you so much for joining us, professor. what we talk about constantly is she is the author of "the politics of resentment." three-tiered, tax reform,

regulatory relief and trade. coming up, what you need to know we got tax reform done. to gear up for tomorrow's trading. this is bloomberg. a lot of people questioned ♪ whether we got it done. it took 30 years from the last time that we have already seen the economic benefits. we have done a lot of work in terms of regulatory relief and a looking forward to the new dodd frank bill passing on a bipartisan basis. that's a big step in the right direction for community banks and regional banks being able to grow. we have been talking about trade for the last year. since my first g20 finance ministers meeting, we have been talking about trade. everything here has been in discussion. the president is concerned about the national security risk as it relates to steel and aluminum. secretary ross has been working on that report. we have been having discussions with people. this is a natural evolution of the president's economic policies. ryan, what about paul what he said the other day, advocating for a more surgical

approach? is he going to be satisfied this announcementis complete? is it going to be a more surgical approach? somewhere in between. you know what i think? the president wants to take on the trade issue. it's an important economic issue . as you know, the chinese market does not open to our companies and our workers in the way that our markets are open for them. the president believes in free and fair trade but he wants reciprocal fair deals. that's why when we go forward, there is a mechanism that will be able to deal with these issues. something that trump "carlet: "what'd you miss? tweeted about intellectual property, as we get to the end of nafta renegotiations in particular, a lot of this, u.s. stocks ending higher in the case of the nasdaq, with little somewhat argue, china has backdoor access through mexico change when it comes to the s&p and canada and is using nafta to 500. don't miss the rate decision tomorrow.

infiltrate the market. with mario draghi's news is that something that you would conference. like to see improved or the u.s. initialt administration would like to see improved? steve: absolutely. jobless claims tomorrow at 8:30 p.m. eastern. that's one of the big issues that does it for us. that we have in terms of things have a great evening. that come into the united states this is bloomberg. ♪ through, in particular,. this is a big issue for the president and something we are focused on as a part of the renegotiations. nafta is an old agreement. we have very important trading relationships with canada and mexico, but the president wants to look at this agreement and once a better deal for american workers and companies. that is what this is all about. trade, inh regards to particular china, it's really no secret, mr. secretary, the china has been taking advantage of the aluminum and steel markets here for quite some time. they have called this policy a stupid idea, to some extent. the relationship, they have

called for a new person within the administration to be the trade person with regards to u.s. china policy. what's your steve: response to the chinese? first of all and again, i want to put this in context. i think that president trump and president xi have the best relationship. from the first time that we met at mar-a-lago, president trump was very direct and concerned alisa: i'm alisa parenti in washington, and you are watching "bloomberg technology." about the trade deficit. here is a check of your "first word news." the chinese acknowledged that new developments in the tariffs and said it was in their regional interest to have a more proposed by the trump balanced trading relationship. administration. the white house says mexico, canada, and other countries may from a high level, we have be exempt from the proposed absolute agreements. i have had many dialogues with tariff under national security my counterparts. carveouts. i saw him in davos, we met with the exemptions would be on a him over two days. case-by-case and country by country basis. we are having very direct discussions with them about how to deal with these issues. attorney general jeff sessions informed lawmakers in sacramento that the doj suit california i think we have been very clear because state laws are preventing federal immigration agents from doing their jobs.

and what our objectives are and he spoke as protests went on we have to figure out if there is a way we can work together. outside california governor jerry brown -- as protests went one of the issues i find on outside. interesting regarding the california governor jerry brown tariffs debate is who it would accused trump of trying to divide the country. help. it's interesting to watch republicans criticize the policy betsy devos went to stoneman proposal and some in the energy douglas high school, where 17 sector raising concerns about berkeley -- were killed. how this would change the cost of energy infrastructure throughout the country, she's said arming some teachers particularly the cost of building pipelines. should be an option, but not a requirement. to the folks who say that this could raise costs or might hurt a nor'easter is tearing across economic growth, they say that the east coast for the second time in less than a is a concern. what is your response to them who feel that these could ultimately offset some of the economic gains made as a result of tax policy? we have a big economic team working on this. treasury, the white house, we have a big team working on this.

we have look at these issues carefully. on the other hand, the issue is that we have unfair trailed -- trade deals and the president is determined that we renegotiate these so that they are good for american business. to theyou mentioned team, but someone was leading the team, gary cohn. what whole will he leave in this administration's economic team? steve: he has been a terrific partner. i've known him since my time at goldman sachs. but there is a big economic team and we will be replacing gary at some point. there are a lot of people working together and who will continue to work together. we will miss him and wish him well, but we have to move forward. kevin: let's start with timetable on when we could get a named successor. steve: i don't think we have a

timetable. like all these others, we will be making recommendations. kevin: jim donovan, peter navarro, larry kudlow, those are some of the names. can i get any sense of who is on the short list? steve: recall that when we were working on the fed chair, you asked of the same thing. [laughter] i do want to go back to one other issue, talking about growth, one year ago we were at 2% gdp and people lined up and said we would never get to 3% gdp all along we said that was our goal. 3% sustained. we are not there on a constant basis, yet, but the president is focused on growth and that is the number one objective. kevin: this policy, should he ultimately go with this, he's headed to pennsylvania, does this administration feel that americans are actually, his

supporters will rally behind this proposal? steve: americans understand that the president is for free and trade -- free and fair trade. he's the salesman and chief. kevin: any timing update on whether we will get the name for the federal reserve vice chair? steve: we are working on that. i think it is something that in the near future. there is a process that people go through for background and every thing else. it's unfortunately a lengthy process. i'm not going to comment specifically, but i can tell you that there is a lot of work that has gone on on that. you mentioned regulatory reform. 11 senators have signed on\to the bill

that is advancing -- signed onto the bill to advance the schedule into early next week. this is something that the administration supports. no? steve: absolutely, we have worked very closely with congress on this. similar to the recommendations that we made and reports that we delivered to the president. the most important issue is that we believe in regulation, but we need to have proper and prudent regulation, making sure the community and regional banks can grow, can lend, that is the engine of growth for our economy. when democrats like elizabeth warren say that it's going to only help the big banks , what is your response? steve: i'm not sure why she feels that way. i don't agree with her on this. this is the way that bipartisan legislation should work, a

compromise on important issues. after it leaves the senate, i think it will be going to the house. are there any specifics that you would like to see added to this bill that you guys can get on board with once it clears the senate? we are supportive of the legislation and certain of the house. what's good for the economy and commercial, regional banks. after that, what's next? what's the next big item for the administration? from the treasury -- steve: from the treasury

perspective, we are working on reform.g i think this is important for national security and everything we are doing. getre hopeful that will through. as you know, we have talked about housing reform. i'm not sure that will get done the summer before thection, but we are determined to try to get fannie and freddie restructured in some format, so that we don't put taxpayers at risk. as you know, we're focused on working closely with the irs on the implementation of the tax jobs act it touches every single aspect. kevin: there has been some chatter, i'm interested to get your take on this, that there could be an additional bill later this year, with tweets about tax reform or even more, president trump said he would like to see more this year. is that actually in the works?

steve: it may be. a few items might need to go through technical corrections, but then i think the president is interested in looking at -- what are the things that we could continue to do afterwards and move forward? bottom line, this week, when there is a new trade terra policy announced, what will the reaction be from the markets and republicans? satisfaction, or a lot of criticism? steve: i'm not going to comment on the markets short-term. there's a lot of volatility. they are still up a ton since the election. and i think america is a great place to invest. i think there is still tremendous upside. mr. secretary, thank you very much for coming on with bloomberg news. steve: thank you for being here. kevin: i will toss it back to

you in the studio. julie: our thanks so much to kevin cirilli for bringing us that interview with the treasury secretary, who said we could be getting the announcement on tariffs as soon as tomorrow and definitely by the end of the week. we will stick with that topic, as the threat of a trade war already shake that shook the markets. gary cohn is out at the white house. here to break it all down for us is subadranuchin -- rajappa. driven extent was this by the news on whether the president will carve out exceptions for countries like mexico and canada? >> a lot of it was.

you could see the reaction on the various charts. we were looking at a lot of technical indicators. this morning we were focused on that 2700 level. were was concern that if broke below that, we could be retesting that 100 day moving .verage seeing that the market run has run out of steam. with this trade talk, we still managed to finish relatively higher, flat on the other indexes, which is an encouraging sign. julia: coming here, what do you think as far as the markets are concerned and the reaction in terms of sentiment? whether it is equities or the rate market, we are still seeing cautiousness about what's going on. subadra: absolutely. i was surprised that the initial

reaction in the asian markets was a bit of a selloff in the nikkei and we saw about -- bonds rally by five points. the reaction in the u.s. markets .oday was relatively muted there is also a lot of optimism on the regulatory side. there could be a lot of changes coming down the pipeline. this year it's going to be all about regulatory reform -- reform. people wereromaine: piling into it. but you are seeing selloff on the companies that take this deal as an input price, as well as those who explored overseas. i don't know if the initial

reaction it we saw, with the departure of gary cohn and what it might have signaled, i think the market kind of digestive that. at the end of the day, we are still in the same position we were in a couple of weeks ago. upbeat beigetively book out of the fed and we are getting some data out of the philadelphia indexes as well. we are seeing the economy still kind of moving ahead. whatever trump has proposed, there is no sense that there will be a catastrophic derailment. at aluminum and steel in isolation, if we can do .hat let's talk about the rest of the week. as far as the rates markets are concerned, there is plenty did i just.

start with the ecb. what are we expecting? there is a lot of data coming that could really move the needle. 1.5 weeks ago we consolidated around these levels, waiting in anticipation of the data, and that is where the focus is going to be. as far as where the ecb is wecerned, we don't know if are expecting a lot of change. we think that at the june meeting they will announce a further tapering of asset purchases after september and are calling for a rate hike. lotwe don't really expect a and we will be paying attention to a press conference for any sort of change in language or tone that could move the needle. how does mario draghi respond to questions about trade tension?

it could year result of collateral damage in these terrorists. i'm sure the question will be posted to him in some way as well. subadra: we don't really have the details, and once we have them, that's when we get the information from the markets. julia: what about the average hourly earnings? subadra: we saw a revision for the december number of 2.7%, 2.9% for january. you really need to see the trajectory towards a higher pick sprintages at the friday . this is one of those instances where we see a path and then it backs down, like we have seen in the past, that would not confirm the trajectory towards higher wages. julie: up until recently, we have seen stock markets shrugging off political rhetoric, political action, with

the exception of the tax bill. do we go back to that? for now that we are in this more volatile environment, will we be seeing more reaction? romaine: we are transitioning to a different phase of this trump administration.